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Which of the following statement(s) is/are true? (Select the correct answer from the options below the statements) (1) A mortgage is a form of long-term loan that is secured on an asset, typically land and property (2) A mortgage is a form of equity and is attached to non-current assets, typically land and property (3) A mortgage may be for a long period: 20 years or more (1) and (3) (1) only (1) and (2) (2) and (3) - Previous

Question

Which of the following statement(s) is/are true? (Select the correct answer from the options below the
statements)
(1) A mortgage is a form of long-term loan that is secured on an asset, typically land and property
(2) A mortgage is a form of equity and is attached to non-current assets, typically land and property
(3) A mortgage may be for a long period: 20 years or more
(1) and (3)
(1) only
(1) and (2)
(2) and (3)
- Previous

Which of the following statement(s) is/are true? (Select the correct answer from the options below the statements) (1) A mortgage is a form of long-term loan that is secured on an asset, typically land and property (2) A mortgage is a form of equity and is attached to non-current assets, typically land and property (3) A mortgage may be for a long period: 20 years or more (1) and (3) (1) only (1) and (2) (2) and (3) - Previous

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RalphElite · Tutor for 8 years

Answer

(1) and (3)

Explain

## Step1: <br />The statements should be evaluated individually for their truthfulness in relation to mortgages.<br /><br />Statement (1) indicates that "A mortgage is a form of long-term loan that is secured on an asset, typically land or property." This definition aligns with the typical understanding of a mortgage. A mortgage is indeed a type of long-term loan which is secured by collateral - often real property like a home or land. <br /><br />Statement (2) asserts that "A mortgage is a form of equity and is attached to non-current assets, typically land and property." This statement is false. While a mortgage is attached to real property, it is not a form of equity. Mortgages are liability or debt-based financial instruments, not claims on the value of the property (equity). <br /><br />Lastly, statement (3) declares that "A mortgage may be for a long period: 20 years or more." Again, this is true. Mortgages typically involve loan agreements that last multiple decades, with 20, 30, or even 40 year mortgages being fairly common.<br /><br />## Step2: <br />Combining the analysis of individual statements, with the options below these statements, only statements (1) and (3) are true, while the statement (2) is false.<br /><br />## Step3: <br />Based on the defined format, present the correct option 'statements (1) and (3)' as the choice that correctly identifies the true statements.
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